The full rollout of the National Disability Insurance Scheme (NDIS) may be delayed after a report found its launch had been rushed and staff were not properly prepared for the next phase of the scheme.

The review of the capabilities of the National Disability Insurance Agency (NDIA) found that while staff had “high levels of intrinsic motivation” they were poorly supported and directed, resulting in confusion about their roles and how the scheme should be carried out.

The report, by Jeff Whalan, AO, Dr Peter Acton and Dr Jeff Harmer, suggested the business model be reviewed and consider having third parties deliver some parts of the agency’s work.

It lambasted the previous Labor government’s decision to bring forward the launch of the scheme by a year to July 2013, blaming the pressing timetable for most of the agency’s significant issues.

“The capability of the agency is weaker than it otherwise would have been and the systems and processes to help ensure consistency of approach are less developed,” the report said.

“And [there’s a] lack of clear guidance for staff on the way the scheme operates, including eligibility and reasonable and necessary support.”

There are also major pieces of work to be done on service provider development, workforce availability, housing, mental health, market regulation and design, according to the review.

The review said major challenges were emerging because staff had spent all of their effort getting the trial phase going and not enough focusing on what needed to be done in preparation for the next phase.

“The current plan is to complete 93% of the eligibility assessments and activate almost 300,000 participants over a three-year period commencing 2017-18,” the report said.

“This mammoth increase in activity will put huge pressures on the available workforce in the sector, let alone the agency. A realistic reassessment of these plans should be done sooner rather than later.”

The report said many of the challenges were expected at this point in the scheme and could be managed successfully but it would require a major effort.

The NDIS has already been launched at sites in the Hunter valley, Barwon, Tasmania and South Australia and there are plans to roll out further launch sites in the Northern Territory, Western Australia and the Australian Capital Territory in July this year.

The report found the former prime minister Julia Gillard’s decision to shift the head office from Canberra to Geelong a month before launch had resulted in recruitment and retention problems, though in the long term it was probably a good decision. The head office will officially move in July.

“The majority of the staff in the national office in Canberra will not go to Geelong and over the next five months most of the senior management in the agency will change,” the report said.

“Also, the current scheduling of recruitment combined with the loss of temporary staff seeking permanent opportunities elsewhere means that many new recruits will not arrive until after the current occupants have left. As a result, there will be a drop in capability over the next six months.”

The IT system was also found to be flawed and there were issues with internal communications within the agency tasked with launching the NDIS.

The assistant social services minister, Mitch Fifield, told the Senate the review was inspiring and sobering and the Coalition were committed to the full rollout of the scheme.

“They’re inspiring because now several thousand Australians are getting the better deal they deserve,” he said.

“… It’s also sobering because the theme that runs through report is decision by the previous government to bring forward by a year launch of trial sites has compromised full rollout.”